""SPAC Stock"" – Google News
Shares of Churchill Capital IV (NYSE: CCIV) fell 18.5% on Wednesday after the acquisition venture’s purpose was completed with electric vehicle maker Lucid Motors.
Churchill’s share price rose to a high of $ 64.86 on February 18 after reports that the SPAC was in talks to merge with Lucid. But since the two companies officially signed their merger agreement on Monday, Churchill’s shares have lost roughly half their value.
Many investors have loved the prospect of owning a piece of Lucid through their Churchill investment. The company’s luxury electric vehicles are expected to compete with those of Tesla (NASDAQ: TSLA). Lucid is led by Peter Rawlinson, who previously served as Tesla’s chief engineer for the popular Model S sedan.
Unfortunately, Churchill shareholders were not as pleased when they were informed of the terms of the merger with Lucid.
The deal values Lucid at $ 24 billion. Churchill shareholders will own 16.1% of Lucid following the merger. So what’s the problem? Well, investors had increased Churchill’s market cap to around $ 15 billion prior to the merger announcement.
The stock market can be irrational at times, but it eventually corrects its mistakes. The market appears to be doing just that by lowering Churchill’s stock.
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